GLOBAL MARKETS-Asian shares fall on caution before US jobs data

Last Updated: Wed, Apr 03, 2013 11:00 hrs

* MSCI Asia ex-Japan down 0.4 pct

* Nikkei soars 2.5 pct, dollar recovers vs yen on BOJ expectations

* Gold falls to 1-month low as investors prefer stocks

* European shares likely retreat

By Chikako Mogi

TOKYO, April 3 (Reuters) - Asian shares fell on Wednesday as investors waited for news on the U.S. economy, while Japanese stocks rose and the dollar recovered against the yen on expectations of forceful monetary easing emerging from this week's Bank of Japan policy meeting.

European markets were likely to track Asian peers lower, with financial spreadbetters predicting London's FTSE 100 , Paris's CAC-40 and Frankfurt's DAX to open down as much as 0.6 percent. Benchmark indices in Spain and Italy were seen retreating 0.8 percent and 0.7 percent respectively when they start trading.

Steady U.S. stock futures pointed to a lacklustre Wall Street open after the Standard & Poor's 500 Index neared its all-time high the previous session.

Positive impact from overnight rises in global equities was short-lived on Asian bourses as investors shifted focus to factors specific to each country while waiting for key events, but helped underpin the dollar against a basket of major currencies and pushed gold to a one-month low this session.

"Traders for the most part today showed a reluctance to open or extend long positions with so much 'event risk' waiting in the wings for the remainder of the week," said Tim Waterer, senior trader at CMC Markets in Sydney, referring to U.S. jobs data as well as policy decisions by the European Central Bank and the Bank of England later in the week.

"What could be adding to some of the reservations on the part of traders is that we are already on elevated levels," he said of Asian equities markets.

The MSCI's broadest index of Asia-Pacific shares outside Japan fell 0.4 percent, turning negative after Australian shares wiped earlier gains to slip 0.6 percent with weakness in commodity prices weighing on mining and energy stocks.

The pan-Asian index's materials and energy sectors were leading underperformers.

"There are two things holding the market back, the mining sector and the energy sector," said Steven Daghlian, market analyst at Commonwealth Securities, of Australian stocks.

Seoul shares reversed gains and fell 0.3 percent, after North Korea suspended South Korean workers' entry into a joint industrial park, intensifying tensions.

Chinese shares struggled to extend gains, with Hong Kong turning down 0.2 percent and Shanghai inching up 0.1 percent. Chinese markets rallied strongly from the last quarter of 2012 to early this year but have been pressured by concerns about tighter property regulations and a patchy Chinese economic outlook.

China said on Wednesday its official purchasing managers' index (PMI) for the non-manufacturing sector rose to 55.6 in March from 54.5 in February. The services PMI followed the official manufacturing PMI earlier this week which climbed to an 11-month high in March but missed market expectations.

The key monthly U.S. nonfarm payrolls report on Friday will likely confirm market views that the Federal Reserve will wish to maintain its extremely accommodative monetary policy, which has underpinned investor sentiment and sharpened risk appetites.

Data on private-sector hiring by payrolls processor ADP is due later this session, followed by Thursday's latest weekly jobless claims.

Uncertainty over global economic growth has dampened appetite for metals, swelling global stockpiles, and on Wednesday pushed Shanghai zinc prices to their lowest in more than four years.


Japan's Nikkei stock average outperformed, soaring 2.5 percent as sentiment was supported by expectations for further easing when the Bank of Japan ends its two-day policy meeting on Thursday, the first under the new governor Haruhiko Kuroda.

Market expectations have been running high for Kuroda to announce at his inaugural policy meeting an increase in bond purchases and a lengthening in the maturities of bonds the BOJ intends to buy.

Guy Stear, head of research with Societe Generale in Hong Kong, saw two themes that prevailed for Asia in the first quarter to continue into the second quarter: the strength of the Nikkei with the weakness of the yen and weakness of China with concerns about the cyclical recovery beginning to abate.

"Japan is the biggest buying opportunity in Asia," he said.

The dollar was up 0.1 percent against the yen at 93.50 , off a one-month low of 92.57 yen touched on Tuesday. The euro was steady at 119.70 yen, but still near its lowest since Feb. 26 of 119.15 yen seen on Tuesday.

The euro eased 0.1 percent to $1.2805, struggling to move far away from a four-month low of $1.2750 touched last week, as the currency remained pressured by concerns about bailout consequences in Cyprus and weak euro zone economies.

The European Central Bank could offer a more dovish tone at this week's meeting.

Spot gold fell to a one-month low of $1,563.06 an ounce earlier this session, approaching the 2013 nadir hit on Feb. 21 of $1,554.49, which was a six-month low.

"There is a lack of interest in gold right now and everybody seems to be sitting on the sidelines. Stocks are still looking more attractive for investors than gold and that's where money continues to flow," said Yuichi Ikemizu, branch manager for Standard Bank in Tokyo

U.S. crude futures fell 0.5 percent to $96.69 a barrel while Brent eased 0.3 percent to $110.34.

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